Escrow & Title
A preliminary title report is issued by a title company PRIMARILY to:
AGuarantee that title is free and clear of all defects
BReport the condition of title and exceptions that will appear in the title policy✓ Correct
CEstablish the market value of the property
DServe as the actual title insurance policy
Explanation
A preliminary title report (also called a 'prelim') discloses the current state of title, including existing liens, encumbrances, easements, and other exceptions that would be excluded from coverage under the proposed title insurance policy. It is an offer to insure, not a guarantee of title itself.
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